This might also be called “statement of income,” “statement of earnings,” or “statement of operating results.” It presents the company’s revenues and expenditures within the covered period, usually one fiscal year, and provides useful information on revenue growth if compared with last year’s income statement. It also shows gross margin, expenses and net income changes.

Operating expenses are the usual costs a company incurs to support its main business activities. Non-operating expenses refer to the expenses related to the company’s financing and investing activities. The income statement measures profitability, not cash flow (see below). For an explanation of fundamental analysis used in income statements, definitions of terminology used in income statements and a sample income statement, see: http://bit.ly/IFH5jj